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DTH News : Satellite rights of over 100 small budget films
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Satellite rights of over 100 small budget films released since 2011 unsold

Producers of more than a hundred small and medium budget Hindi films released between 2011 to date have been unable to sell the satellite rights of their films. This could be a severe blow for them as most producers depend on TV revenues to make up for losses at the box office.
The films are a motley mix of eminently forgettable ones like 'Cycle Kick' and 'Phhir'. The more recent ones include Eros International's Teri Meri Kahaani starring Priyanka Chopra and Shahid Kapoor and 'Maximum' starring Sonu Sood.

Most of these films come with an overpriced tag, making recovery close to impossible. "The speculation of how much a film will yield from the satellite market is what is going to crash this market," says Hemal Jhaveri, senior vice-president and general manager, Star Gold and Movies OK, who spent big bucks buying films like 'Singham' and 'Dabangg 2' recently.

With prices escalating to Rs 50 crore for a single big film (like 'Dabangg 2'), contracts for satellite rights are being signed for a period of as long as seven years. Yet, Jhaveri points out, costs are not recovered over this period.

Producers of smaller films justify their price tags - in the range of Rs 2 to Rs 5 crore - by the price blockbusters like 'Dabanng' demand, and get. "Often, there is a mismatch between price expectations and potential of delivery. This, results in smaller films suffering and remaining unsold," says Hiren Gada, director at Shemaroo, which holds a lifetime rights library to over 600 films.

In the last few years, general entertainment channels (GECs) have been shelling out big bucks for buying the rights of Hindi films; the advance money that comes from these sales contributes as much as 30-35 per cent to a film's cost of production. Many of these deals are struck pre-release.

For films that have had a bad run at the theatrical box office, satellite revenue holds out a promise of a bail-out. When that dries up, it skews the balance sheet of the producer, leaving almost no other hope.

Clearly, the buyers are not in a mood to bail out the industry any longer. "Bad content has no value whatever the price and it will not work on any screen," says Jayantilal Gada, who heads film acquisition at Zee TV. He adds that he has a library of over 4,000 films that he can rotate and so sees no reason to shell out any money at all for these films.

-economictimes
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